How to Apply for a PAN Card for Minors?

For the benefit of readers who might be interested, we cover the subject of PAN cards for minors in this blog.

Every Indian citizen who pays taxes is given a unique identity number, which is contained on their PAN card. The PAN card is required for all taxpayers, including individuals, limited liability partnerships (LLPs), businesses, local governments, etc. It connects all of the taxpayer’s financial transactions, making it simple for the government to keep track of every PAN cardholder’s tax-related data.

There is a myth that only people over the age of 18 can apply for a PAN card because all taxpayers are required to have one. The Income Tax (IT) department hasn’t specified an upper age limit for PAN card applications nonetheless. Therefore, anyone can apply for a PAN card, including children.

PAN Card Requirement for Minors

PAN cards are required for minors in the following situations:

When parents want to nominate their underage child to receive their financial products, such as shares or investments

When parents invest in the name of the child

When a daughter’s minor Sukanya Samriddhi Yojana account or a child’s bank account needs to be opened

Income earned by a minor from any investments or other sources is not taxed and is included in the parent’s income. However, the following situations require a PAN card for children and are taxable:

When a person is physically unable to see (blind, etc)

When they have independent means of earning

Procedure for Applying for a Minor PAN Card

A PAN card cannot be immediately applied for by minors on their own. Therefore, the assesses who are parents, guardians, or representatives must apply for the minor PAN card. They have the option of applying offline or online for a minor PAN card.

Online Procedure to Apply for a Minor PAN Card

Read the instructions for filing Form 49A at https://tin.tin.nsdl.com/pan/Instructions49A.html.

Visit the official NSDL website.

Choose the “New PAN—Indian Citizen (Form 49A)” application type. Select “Individual” as the category.

As instructed in the filing instructions for Form 49A, complete all the fields.

Upload the relevant documents and the photo.

Click the “Submit” button after paying the fee with a debit card, credit card, demand draught, or net banking.

The application will be given an acknowledgement number that may be used to monitor its progress.

Post it to the Income Tax PAN Services Unit’s Pune address in an envelope with all the necessary documentation inside (if it hasn’t already been uploaded) and the demand draught, if that’s the method of payment selected.

Following the application’s successful verification, the PAN card will be delivered to the specified address within 10 to 15 working days.

Offline Procedure to Apply for a Minor PAN Card

Download Form 49A from the official NSDL website.

Read Form 49A’s accompanying filling-out instructions before beginning.

According to the directions, complete all the fields.

Include a copy of any pertinent documents.

Attach two photographs of the child.

Send the application form, the necessary paperwork, and the appropriate fees to the nearby UTIITSL/NSDL office or TIN facilitation centre.

Upon application submission, an acknowledgement number will be sent. The acknowledgement number can be used to monitor the application’s progress.

The application will be successfully verified, and the PAN card will then be issued to the specified address.

Alternatively, send the attached envelope to the following address with the words “APPLICATION FOR PAN” and the “Acknowledgment Number” on the outside:

Income Tax PAN Services Unit,

NSDL e-Governance Infrastructure Limited,

5th floor,

Mantri Sterling,

Plot No. 341,

Survey No. 997/8,

Model Colony,

Near Deep Bungalow Chowk,

Pune – 411016

Documents Required for Minor PAN Card Application

Identification, residence, and age verification documents must be submitted or attached while applying for a PAN card. However, for children, the parent’s or guardian’s identification and proof of address documents will be taken into account. However, the paperwork showing the minor’s date of birth should be uploaded or attached rather than the parent’s or guardian’s.

The minor’s Aadhaar card should be uploaded or connected when the minor’s Aadhaar card is chosen as the proof of address and identity, not the parents’ or guardians’. Below is a collection of acceptable documents for use as ID, address, and age evidence.

Proof of Identity Documents

The minor’s parents or guardians may provide any of the following documents as identification:

Aadhaar card

Passport

Ration card

Driving license

Voter’s ID card

Photo ID card issued by the government

The original identity document, which must be attested to by a member of the Legislative Assembly, Parliament, Gazetted Officer, or Legislative Council

Arm’s license

Pensioner card

Central government health service scheme card

Ex-servicemen contributory health scheme photo card

The actual bank certificate, on business letterhead from the branch of the issuing bank, together with the applicant’s bank account number and an attested photo

Proof of Address Documents

Any of the following documents may be used by the minor’s parents or guardians as evidence of address:

Aadhaar card
Driving license
Passport
Post office passbook
Voter’s ID card
Domicile certificate
Property registration document

The original certificate of address, which must be signed by a municipal council member, a gazette officer, or a member of the legislature

A copy of one of the following documents, which must be no older than three months:

Electricity bill
Water bill
Landline telephone or broadband connection bill
Consumer gas connection book or card or piped gas bill
Credit card statement
Bank account statement
Original employer certificate

Proof of Birth Documents

The minor’s birth certificate and the following papers may be used as proof of age:

Birth certificate
Aadhaar card
Passport
Photo ID card issued by the government
Mark sheet of recognized board
Domicile certificate
Affidavit sworn before a Magistrate having the date of birth
Central government health service scheme photo card
Ex-servicemen contributory health scheme photo card

Purpose of the Minor PAN Card

Below is a list of some of the uses for a minor PAN card:

For children under the age of five, a Minor PAN Card may be used as identification.
If you want your child to be the nominee for your investments, it is now required.
A PAN card is required if the parents want to invest money in their child’s name.
If the youngster is working, section 64 of the law will link their income to their parent’s income (1A). However, the money is taxable, and in the instances listed below, the earner must submit an income tax return through a parent or guardian.
If the minor generates income on their own through knowledge, talent, or other abilities.

Fee Applicable

For Indian citizens, the application fee for a PAN card is Rs. 115.90 (taxes included).

Make Payment

After completing Form 49A, choose your preferred method of payment. The options available are as follows:

Demand draft
Cheque
Credit/debit card
Net banking

Issuance of a Minor PAN Card

Within 60 days of receiving the SMS and upon the completion of Form 49A and verification by the authority, the minor applicant will receive a PAN card

Applying for a PAN card as a minor has some advantages. The advantages of having a PAN card for minors are now covered.

If you intend to name them as a nominee on your investments, such as real estate, stocks, or any other financial asset, a PAN card is legally necessary. Therefore, you would need to provide the young child’s PAN card if you intended to designate them as a nominee for your investments.

Tax on Income of the Minor

The government believes that a minor child cannot make any income on his or her own and that any revenue that does arise in the minor child’s name is actually the parents’ income being received in the child’s name.

Any income received in the name of a minor child is, therefore, combined with the income of the parent with the greater income on the income tax return.

The income tax slab rates would be applied after adding the minor child’s income to that of the parent with the greater income.

However, if the parents’ marriage does not continue, the parent’s income should be combined in the hands of the parent who cared for the minor child during the fiscal year.

If the child’s income is already included in either parent’s total income, it cannot be included in the other parent’s total income in the next year unless the income tax officer determines it is required after providing the other parent a chance to be heard.

Certain Incomes Taxable Only in the Hands of the Minor Child

Although the general rule is that the minor child’s income should be combined with the income of the parent with the higher total income, the following incomes must not be combined and are instead taxed in the minor’s own hands:

Any income of a minor child who has a disability of the kind listed in Section 80U, such as a physical impairment or total blindness, etc.
Income that the minor child receives as a result of whatever physical labour he performs.
Any income that the minor child receives as a result of engaging in any activity that requires the use of his abilities, talents, or specialized training and experience

Any of the aforementioned incomes that are earned by a minor child will not be combined with the parent’s income and will instead be taxed by the minor child.

The minor would also be able to benefit from income tax slabs because these earnings would not be combined with those of the parent.

Other Relevant Points Regarding Clubbing of Minor Child’s Income

A child in regard to an individual includes that person’s adopted child as well as stepchildren.
If neither of the minor child’s parents is still alive, the minor’s income cannot be combined, and the minor’s guardian must submit the minor’s income tax return. If the guardian is not a minor, then such income is not to be included in the guardian’s income.
The income up until the date the minor child remained a minor in the financial year shall be combined in the parent’s hands in the event that the minor child reaches majority during the financial year.

What Happens After the Child Turns 18?

Since the PAN card issued in a minor’s name lacks both a photo and a signature, it cannot be used as identification. Therefore, a request for a PAN card update or correction must be submitted after the child turns 18.

A PAN card has several benefits, which are detailed below:

A PAN card aids in business startups. Every business in India must have a PAN in order to operate in accordance with the regulations established by the Indian government.

Tax purposes are one of the main justifications for having a PAN card. If a person does not link their PAN to their bank account and has annual interest earnings on savings deposits of more than Rs. 10,000, the concerned bank will deduct TDS at a rate of 30% rather than 10%.

Opening a Demat Account or Bank Account

Current regulations state that if a person does not have a PAN card, they will not be able to create a bank account.

There is only one circumstance in which this stated rule is not applicable, and that is when one chooses to register a zero balance account in accordance with the Prime Minister Jan Dhan Yojana. A voter ID card or a ration card might be used in this situation to prove identity. Similar to that, opening a Demat account requires a PAN card.

Income Tax Return Filing

Everyone who is subject to income tax, as you may know, is required to file their tax returns. And a PAN card is required in order to achieve it.

Investing and Purchasing RBI Bonds or Insurance

An individual must first fill out a form found on the Association of Mutual Funds of India (AMFI) website before making an investment. He or she must also include a self-attested copy of the PAN card and address verification.

Only when a person is KYC-compliant and in possession of a PAN card will their KYC documentation be accepted when investing. Similar to this, a PAN card is required if you invest Rs. 50,000 or more in RBI bonds.

Buying Foreign Currency

According to the Foreign Exchange Management Act, a PAN card is required for foreign currency purchases of 50,000 rupees or more. This is primarily due to the fact that all transactions involving foreign currency are classified as either current account transactions or capital account transactions.

Transaction of Listed or Unlisted Securities

Purchasing or Selling Immovable Property

When selling or buying immovable property, such as a house that is worth more than Rs. 10 lakh, a person must provide their PAN information.

Purchasing or Selling a Four-Wheeler Vehicle

Additionally, a PAN card is required for anyone who sells or buys a four-wheeled vehicle. A PAN card is required even in situations where someone wishes to get a loan to buy an automobile.

Cash Deposits, Pay Orders, Banker’s Cheques, and Bank Drafts

If one chooses to use pay orders, banker’s checks, bank draughts, or cash deposits exceeding a limit of Rs. 50,000, the PAN card must be presented. This also applies to situations where a person is prepared to put more than $50,000 in cash into his or her bank account.

While Applying for Loan

It becomes mandatory to give your lender a copy of your PAN card when applying for loans. This is applicable to all loan types, including secured and unsecured ones.

To Buy Expensive Jewellery

A copy of your PAN card may be required when you spend more than Rs. 5,00,000 on expensive Jewellery.

For Cellphone Connections

You may occasionally be required to give the phone company a copy of your PAN card in order to obtain a new mobile connection.

If someone engages in these activities without a PAN card, they must submit a declaration in Form 60.

You require a PAN card, which is an essential document, almost everywhere. Fortunately, applying for, getting PAN card is simple. The online procedure takes less time and is simpler than the offline procedure. It is obvious from this that a PAN card is a necessary document in the present corporate environment. A minor can receive a PAN card from the government by following the steps outlined in this blog post.

Based on our discussion thus far, we hope that this blog will be informative for all readers who are interested in learning how to apply for a PAN card for minors.

How to Apply for a PAN Card for Minors